Davis Signs $3.6 Billion Package of Budget Cuts

As expected, Gov. Gray Davis (D) yesterday signed a series of bills that will reduce California's record budget deficit by $3.6 billion through borrowing against state pension funds and cutting some state programs, including Medi-Cal, the Los Angeles Times reports (Halper, Los Angeles Times, 5/6). The legislature approved the series of bills last week after Democrats and Republicans agreed to a compromise on the budget package. In exchange for votes for a Democrat-backed plan to borrow against state pension funds, Republicans negotiated approximately $1.8 billion in spending reductions (California Healthline, 5/2). One of the bills signed by Davis (SBX1 26) would cut $327 million from health programs, including $50 million from Medi-Cal dental care and $42 million by increasing Medi-Cal eligibility reviews from annually to semi-annually, the San Diego Union-Tribune reports (Mendel, San Diego Union-Tribune, 5/6). The bill also requires performance and accountability standards on counties when processing Medi-Cal applications and redeterminations, as well as reductions in Healthy Families, prostate cancer treatment and early mental health programs (Davis release, 5/5). "It is clear we have a long way to go," Davis said, noting that lawmakers have saved only $9 billion thus far from an expected shortfall of up to $35 billion over the next 14 months, the Times reports. "I'm convinced we can get there if we act in a bipartisan fashion and respect one another's differences," he said (Los Angeles Times, 5/6). "There were no good cuts, nobody comes to Sacramento to make reductions like this. Sometimes the choices confronting you are between bad and worse," Davis added. However, Shannon McCroskey of the Rolling Start Center for Independent Living, said, "They're balancing the budget on the backs of the poor and the disabled, and it doesn't seem like that should even be a choice" (Drucker, San Bernardino County Sun, 5/5).